Sundaram Asset ManagementCompany Limited
16th Annual Report 2011-12
Board of Directors
D N Ghosh Chairman
S Krishnamurthy
T T Srinivasaraghavan
Ashoke Bijapurkar
T Anantha Narayanan
Rishikesha T Krishnan
T P Raman Managing Director
Harsha Viji Deputy Managing Director
Audit Committee
S Krishnamurthy Chairman
T Anantha Narayanan
T P Raman
Chief Financial Officer
T S Sritharan
Company Secretary
P Sundararajan
Bankers
AXIS Bank Ltd.
BNP Paribas
Corporation Bank
HDFC Bank Ltd.
ICICI Bank Ltd.
Kotak Mahindra Bank Ltd.
State Bank of India
HSBC Bank Ltd
IndusInd Bank Ltd
Auditors
M/s. Brahmayya & Co., Chennai Chartered Accountants
Information Security Assurance Auditors
M/s. Tejas Brainware Systems (P) Ltd., Chennai
Registered Office
No. 21, Patullos Road,
Chennai - 600 002
Corporate Office
SUNDARAM TOWERS
II Floor, 46, Whites Road, Chennai - 600 014.
Tel: 28583362, Fax: 28583156
Website : www.sundarammutual.com
Annual Report 2011-121
Sundaram Asset Management Company Limited
Agra
Ahmedabad
Ahmednagar
Ajmer
Allahabad
Amristar
Anand
Aurangabad
Bangalore
Baroda
Belgaum
Bhavnagar
Bhilai
Bhopal
Bhubaneshwar
Calicut
Chandigarh
Chennai*
Cochin
Coimbatore
Cuttack
Dehradun
Delhi
Dubai
Durgapur
Goa
Gorakpur
Guwahati
Hubli
Hyderabad
Indore
Jaipur
Jalgaon
Jallandar
Jamnagar
Jamshedpur
Jodhpur
Kanpur
Kolhapur
Kolkatta
Latur
Lucknow
Ludhiana
Madurai
Mangalore
Mumbai
Mysore
Nagpur
Nashik
Panipat
Patna
Pondicherry
Pune
Raipur
Rajamundhury
Rajkot
Ratnagiri
Rourkela
Salem
Sholapur
Siliguri
Surat
Thrissur
Tirunelveli
Trichy
Trivandrum
Udaipur
Varanasi
Vellore
Vijayawada
Vizag
* Corporate office and two branches in Chennai.
Risk Management CommitteeT Anantha Narayanan ChairmanT P RamanHarsha VijiRishikesha T Krishnan
Executive CommitteeT P Raman ChairmanHarsha VijiT T SrinivasaraghavanT Anantha NarayananAshoke Bijapurkar
Remuneration CommitteeD N Ghosh ChairmanT P RamanHarsha VijiT T SrinivasaraghavanAshoke Bijapurkar
Other Committees
Senior Management
Sundaram Asset Management Company Limited
Branches
Sponsor
Sundaram Finance LimitedRegistered Office: 21, Patullos Road,
Chennai 600 002
India
Name Designation Name DesignationSunil Subramaniam Director & Head -Sales & Marketing
Lakshminarayanan D Chief Operating Officer
Vijayendiran R Head - Global Business Development
Priya A Kumar Deputy Head - Sales (Special Channels)
Benis Kumar M Deputy Head - Sales (Core Channels)
Surendra Singh Yadhav Vice President - Sales , North
Amit Kumar Ray Vice President - Sales , East
Samir P Deshpande Vice President-Sales, West
Venkatesh P Vice President-Sales, South
Satish Ramanathan Director & Head – Equity
Dwijendra Srivastava Head – Fixed Income
Srividhya R Vice President – Equity
Krishnakumar S Vice President – Equity
Venkatesan J Vice President – Equity
Bharath S Fund Manager - Equity
Siddharth Chaudhary Fund Manager - Fixed Income
Annual Report 2011-122
Annual Report 2011-123
Sundaram Asset Management Company Limited
Sundaram Asset Management Company LimitedA subsidiary of
Contents
Directors’ Report 4
Auditors’ Report 8
Balance Sheet 10
Profit and Loss Statement 11
Significant accounting policies 12
Notes to the accounts 13
Cash Flow Statement 23
Your Directors have pleasure in presenting the Sixteenth Annual
Report of Sundaram Asset Management along with the audited
financial statement of accounts for the year ended March 31,
2012. The financial performance of your Company in 2011–
12 is summarised in the accompanying table:
Financial Results: (Rs in lakhs)
Particulars Year ended March March
31, 2012 31, 2011Gross Income 10510.24 12239.64
Profit/(loss) before depreciation and tax 1704.60 2229.45
Less:
Provision for Depreciation 152.45 148.53
Profit Before Tax 1552.15 2080.92Provision for Taxation 451.83 744.77
Profit after tax 1100.32 1336.15Surplus brought forward from the
previous year 3338.33 2583.69
Surplus available for appropriations 4438.65 3919.84Less: Appropriation:
Dividend Proposed (Final) 306.67 383.33
Dividend Distribution Tax 49.74 62.18
Transfer to General Reserve 82.52 136.00
Surplus carried to Balance Sheet 3999.72 3338.33Your Company earned a total income of Rs 10510.24 lakh for
the year 2011-12, by way of investment management and
advisory fees and other income during the year as compared to
Rs. 12239.64 lakh in 2010-11 representing a decrease of
14.13% over the previous year. Your company reported a profit
after tax of Rs. 1100.32 lakh for the year as compared to Rs.
1336.15 lakh in the previous year.
Your Directors are pleased to recommend a dividend of 20%
on the paid-up capital of the company. The dividend, together
with dividend tax, absorbs a sum of Rs. 356.41 lakh. A sum of
Rs. 82.52 lakh will be transferred to the General Reserve
leaving a balance of Rs. 3999.72 lakh to be retained as surplus.
Snapshot of the Mutual Fund Industry
Gross mobilization by the mutual fund industry during the year
amounted to Rs. 68,19,679 Crores as against Rs. 88,59,515
Crores in the previous year, a decline of 23.02%. The industry
also witnessed a gross redemption of Rs. 68,41,702 Crores
representing 23.20 % decrease from the previous year’s figure
of Rs. 89,08,921 Crores. On a net basis, there was an outflow
of Rs.22,023 Crores in 2011-12 as against the Net outflow of
Rs. 49,406 Crores recorded in the previous year.
Sundaram Mutual Fund – Performance
Trend in flows: Your Directors report that during 2011-12,
Sundaram Mutual Fund schemes mobilized a sum of Rs.
59,922 Crores (Rs. 49,788 Crores in 2010-11). This represented
an increase of 20 % in the amount mobilized.
During the year 2011-12 the gross redemption from the
schemes was Rs. 59,874 Crores as against the previous year’s
redemption amount of Rs. 49,557 Crores. This represents an
increase of 20.82% from the corresponding figure in the
previous year. Net Inflow during the year 2011-12 was
Rs.48.34 Crores.
State of AUM: The Average Assets under Management of
Sundaram Mutual Fund for the year ended March 31, 2012 was
Rs.14,226.33 Crores, as compared to Rs. 13,945.54 Crores for
the previous year ended March 31, 2011. This represents a
growth of 2.01 % from the previous year. The closing AUM of
Rs. 11864.24 Crores of Sundaram Mutual Fund as at March 31,
2012 represented a share of 2.02 % of the Industry AUM of
Rs.5,87,217 Crores.
The no. of investor folios of the Mutual Fund schemes has
marginally declined from 2.22 million in 2010–11 to 1.99
million in 2011–12.
Annual Report 2011-124
Sundaram Asset Management Company Limited
Report of the Directors
40%
25%
20%
05
1015202530354045
2009-10 2010-11 2011-12
Div
iden
d (in
%)
Year
Dividend Declared (in %)
3091
2081
1552
2084
13361100
0
500
1000
1500
2000
2500
3000
3500
2009-10 2010-11 2011-12
PB
T &
PA
T (R
s. in L
akhs)
Year
Profit Before & After Tax
Profit Before Tax (Rs. in Lakhs) Profit After Tax (Rs. in Lakhs)
During the year, your Company conducted 60 Investor
Awareness Programme in 60 centres. The total number of
investors who attended the programme was approximately
1875
Performance
The performance of Sundaram Mutual Fund schemes received
critical acclaim from independent fund intelligence outfits
during the year. The industry faced redemption pressures during
the year following volatility in the equity market. The scheme’s
overall performance reflected the general trend in the mutual
fund industry.
During the year 2011-12 the Fund house launched Sundaram
Equity Plus, an open ended equity scheme and successfully
mobilized Rs.133.68 Crores from 27,045 investors. The Fund
house also launched a series of Fixed Term Plans and Capital
Protection Oriented Funds during the year.
Sundaram Asset Management continues to make investment in
enhancing its research and fund management capability. We
also continue to ensure availability of contemporary trading
and monitoring systems for the fund managers, dealer and
compliance. These will stay a key focus area on a continuous
basis, as it is critical to handle investor funds with the optimum
skill sets and responsibility.
Your company will continuously strive to provide well-defined
products that cater to a diverse range of risk, return and
liquidity preferences of investors.
Your company is confident of posting reasonable growth in
AUM over the next years on the back of consistent
performance, a well thought-out marketing and distribution
strategy, enhanced geographical reach and quality customer
service.
Portfolio Management Services
Sundaram Portfolio Managers manage an asset size of Rs.
55.52 Crores under discretionary service and Rs. 67.46 Crores
under advisory services as on March 31, 2012.
Branches
Your Company has a total of 73 branches as at the year end.
Directors
Mr. T. P. Raman, Managing Director, has sought to retire from
the Company at the end of his term on June 30, 2012. Your
directors place on record the significant contribution made by
Mr. T P Raman to the growth and development of your
company and mutual fund through his vast knowledge and
experience during his tenure of over 15 years as the Managing
Director. Subsequent to retirement, he will continue to be a
Non-Executive Director of the Company.
The Board appointed Mr. Harsha Viji, Deputy Managing
Director as the Managing Director of the Company effective
from July 01, 2012.
Mr. T. T. Srinivasaraghavan and Mr. Ashoke Bijapurkar retire by
rotation at the ensuing Annual General Meeting and, being
eligible, offer themselves for re-election.
Necessary resolutions are submitted for your approval.
The Board of Directors of Sundaram Asset Management met
Six times in 2011-12.
Committees of the Board
Audit Committee
The Audit Committee of the Board consists of Mr. S.
Krishnamurthy, Mr. T. Anantha Narayanan and Mr. T.P. Raman.
Mr. S. Krishnamurthy chaired the Meetings of the Committee.
The Committee met five times in the year 2011-12 and
reviewed the financial accounts/policies, adequacy of internal
control systems and interacted with Statutory Auditors, Internal
Auditors and Systems Auditors. The Committee also reviewed
audit plans, unaudited/audited financial results, and
observations as well as related follow-up reports of the
management.
Risk Management Committee
The Risk Management Committee consists of Mr. T Anantha
Narayanan, Mr. Rishikesha T. Krishnan, Mr. T P Raman and Mr.
Harsha Viji. Mr T Anantha Narayanan chaired the meetings of
the Committee. The Committee monitors the implementation of
enterprise risk management guidelines, set/modify the limits
for issuers and counter party exposure, review exceptions and
suggests improvements to the risk management framework
from time to time. The committee met two times in the year
2011–12.
Executive Committee
This committee looks into investment strategy, fund
Annual Report 2011-125
Sundaram Asset Management Company Limited
Equity Debt Liquid Funds Fund of Funds
0
2000
4000
6000
8000
10000
12000
14000
16000
2009-10 2010-11 2011-12 45 Schemes 63 Schemes 85 Schemes
Ave
rage
AU
M (R
s. in
Crs
)
Years
Average Assets Under Management
Rs. 13878 Crs Rs. 14226 Crs Rs. 13946 Crs
performance and fund management guidelines for new
products. Its scope includes review of the business plan of the
company, performance of funds and the company, human
resource policy and strategy and making recommendation to
the Board for taking appropriate decisions.
The members of the Committee are Mr. T P Raman, Mr. Harsha
Viji, Mr. T. T. Srinivasaraghavan, Mr. T. Anantha Narayanan and
Mr. Ashoke Bijapurkar. The committee meetings were chaired
by Non executive directors on a rotational basis. Senior
management personnel of the Company attend the meetings
of the Committee. This committee met three times during the
year under review.
Remuneration Committee
The Remuneration Committee comprises Mr. D.N. Ghosh, Mr.
T.P.Raman, Mr. Harsha Viji, Mr. T.T.Srinivasaraghavan and Mr.
Ashoke Bijapurkar. Mr. D.N.Ghosh is the Chairman of the
committee. The Committee decides on the broad parameters
governing the remuneration policy for the key employees of
your company. The committee met once in 2011 – 12.
Public Deposits
Your Company has not accepted any deposits.
Particulars regarding Conservation of Energy, Technology
Absorption and Foreign Exchange Earnings and Expenditure
(a) As the Company does not carry out any manufacturing
activities, particulars required to be disclosed with respect to
the conservation of energy and technology absorption in terms
of Section 217(1)(e) of the Companies Act, 1956 read with the
Companies (Disclosure of Particulars in the Report of the Board
of Directors) Rules, 1988 are not applicable.
(b) Foreign Exchange, earnings and expenditure during the year.
Particulars 2011-12 (Rs.) 2010-11 (Rs.)Foreign Exchange Earnings 1,01,24,324 7,31,22,548
Foreign Exchange Expenditure 3,46,09,884 2,53,87,158
Dividend Paid to Non –
Resident Shareholder –
BNP Paribas Asset Management Not Applicable 3,06,05,125
Personnel
Your company had 296 employees on its rolls as on March 31,
2012. Your company continues to invest in enhancing the skill-
sets of employees.
Particulars of Employee Remuneration
As required by the provisions of Section 217(2A) of the
Companies Act, 1956, read with the Companies (Particulars of
Employees) Rules, 1975, details are set out in the annexure to
the Directors’ Report. Any shareholder interested in obtaining
a copy of the said annexure may write to the Company
Secretary at the registered office of the Company.
Directors’ Responsibility Statement pursuant to Section217(2AA) of Companies Act, 1956
The Directors confirm:
1. That in the preparation of the annual accounts, the
applicable accounting standards have been followed;
2. That they selected such accounting policies and applied
them consistently and made judgments and estimates that
are reasonable and prudent so as to give a true and fair view
of the state of affairs of the Company at the end of the
financial year and the profit or loss for that period;
3. That they have taken proper and sufficient care for the
maintenance of adequate accounting records, in
accordance with the provisions of the Companies Act, 1956
for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
4. That they have prepared the annual accounts on a going
concern basis.
Auditors
Messrs Brahmayya & Co., firm of Chartered Accountants, retire
at the ensuing Annual General Meeting and is eligible for re-
appointment. A certificate under Section 224(1B) of the
Companies Act, 1956, has been received from the firm.
SEBI Regulations
As always, your Company complied with SEBI (Mutual Fund)
Regulations, 1996.
Acknowledgement
Your Directors wish to place on record their deep appreciation
of the professional support and guidance received from the
Trustees of Sundaram Mutual Fund and the Sponsors -
Sundaram Finance Limited.
Your Board of Directors also thank the Securities and Exchange
Board of India, Association of Mutual Funds of India, the
company’s bankers and other intermediaries for their unstinted
support.
Your Directors place on record their deep appreciation of the
dedication and commitment displayed by the employees of
your Company.
For and on behalf of the Board
Place: Chennai D N Ghosh
Date: May 15, 2012 Chairman
Annual Report 2011-126
Sundaram Asset Management Company Limited
Annexure – I
Annexure to the Directors Report Closing AUM
Sl.No Name of the Schemes as on 31-03-12 (Rs. in Crore)
Equity Schemes1 Sundaram Select Mid Cap 2,080
2 Sundaram Tax Saver 1,420
3 Sundaram– Select Thematic Funds – Energy Opportunities 822
4 Sundaram Select Focus 727
5 Sundaram S.M.I.L.E Fund 459
6 Sundaram Select Thematic Funds – PSU Opportunities 269
7 Sundaram Select Thematic Funds – Capex Opportunities Fund (Growth) 260
8 Sundaram Select Thematic Funds – Capex Opportunities Fund (Dividend) 228
9 Sundaram Select Thematic Funds – Financial Services Opportunities 224
10 Sundaram Equity Multiplier Fund 177
11 Sundaram– Select Thematic Funds – Rural India Fund 161
12 Sundaram Growth Fund 160
13 Sundaram Equity Plus 149
14 Sundaram India Leadership Fund 123
15 Sundaram Balanced Fund 56
16 Sundaram Select Thematic Funds – Entertainment Opportunities 36
17 Sundaram Global Advantage – Fund of Funds Scheme 57
Total AUM – Equity Schemes – (A) 7,408Debt & Liquid Schemes
18 Sundaram Money Fund 577
19 Sundaram Ultra Short Term Fund 472
20 Sundaram Bond Saver 59
21 Sundaram Flexible Fund – Short Term Plan 26
22 Sundaram Monthly Income Plan (Not an assured Income Scheme) – Moderate Plan 22
23 Sundaram Select Debt – Short Term Asset Plan 11
24 Sundaram Monthly Income Plan (Not an assured Income Scheme) – Conservative Plan 10
25 Sundaram Monthly Income Plan (Not an assured Income Scheme) – Aggressive Plan 10
26 Sundaram Flexible Fund – Flexible Income Plan 1
27 Sundaram Income Plus 0.81
28 Sundaram Gilt Fund 0.27
29 Sundaram Fixed Term Plans (including Interval Funds) (43 schemes) 2031
30 Sundaram Capital Protection Oriented Schemes (Closed-end Scheme) (14 schemes) 1235
Total Aum – Debt & Liquid Schemes – (B) 4,456Grand Total – (A) + (B) 11,864
For and on behalf of the Board
Place: Chennai D N Ghosh
Date: May 15, 2012 Chairman
Annual Report 2011-127
Sundaram Asset Management Company Limited
1. We have audited the attached Balance Sheet of Sundaram Asset
Management Company Limited (the company) as at 31st March
2012, the Profit and Loss Statement, the notes thereon and the
Cash Flow Statement of the company for the year ended on that
date, annexed thereto, which we have signed under reference
to this report. These financial statements are the responsibility of
the company’s management. Our responsibility is to express an
opinion on these financial statements based on our audit.
2. We conducted our audit in accordance with the auditing standards
generally accepted in India. Those Standards require that we plan
and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and
significant estimates made by the management, as well as
evaluating the overall financial statement presentation. We believe
that our audit provides a reasonable basis for our opinion.
3. As required by the Companies (Auditor’s Report) Order, 2003 as
amended by the Companies (Auditor’s Report) (Amendment)
Order, 2004 (together the ‘Order’) issued by the Central
Government in terms of sub-section (4A) of section 227 of the
Companies Act, 1956, (the Act) and based on the information and
explanation given to us, we give in the Annexure a statement on
the matters specified in paragraphs 4 and 5 of the said Order.
4. Further to our comments in the Annexure referred to above, we
report that:
(i) we have obtained all the information and explanations, which
to the best of our knowledge and belief were necessary for the
purposes of our audit.
(ii) in our opinion, proper books of account as required by law
have been kept by the company so far as appears from our
examination of those books.
(iii) the Balance Sheet, Profit and Loss Statement and the Cash
Flow Statement dealt with by this report are in agreement with
the books of account.
(iv) in our opinion, the Balance Sheet, Profit and Loss Statement
and the Cash Flow Statement dealt with by this report comply
with the accounting standards referred to in sub-section (3C) of
section 211 of the Companies Act, 1956, to the extent
applicable.
(v) on the basis of written representations received from the
directors, as on 31st March 2012 and taken on record by the
Board of Directors, we report that none of the Directors is
disqualified as on 31st March 2012 from being appointed as a
Director in terms of clause (g) of sub-section (1) of section 274
of the Companies Act, 1956; and
(vi) in our opinion and to the best of our information and
according to the explanations given to us, the said accounts
together with the notes thereon give the information required
by the Act in the manner so required and give a true and fair
view in conformity with the accounting principles generally
accepted in India,
(a) in the case of the Balance Sheet, of the state of affairs of
the company as at 31st March 2012;
(b) in the case of the Profit and Loss Statement, of the profit
for the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows
for the year ended on that date.
For BRAHMAYYA & CO.,Chartered Accountants
Place : Chennai Firm Registration Number: 000511S
Date : May 15, 2012
P.BABUPartner
Membership No.203358
Annual Report 2011-128
Sundaram Asset Management Company Limited
Auditors’ ReportTO THE MEMBERS OF SUNDARAM ASSET MANAGEMENT COMPANY LIMITED
1. a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
b) Fixed assets have been physically verified by the management
during the year in accordance with a phased plan of verification,
which in our opinion is reasonable having regard to the size of
the company and the nature of fixed assets. The discrepancies
noticed on such verification were not material and have been
properly dealt with in the books of accounts.
c) In our opinion and according to the information and explanations
given to us, a substantial part of fixed assets have not been
disposed off by the company during the year.
2. In our opinion and according to the information and explanations
given to us, the company has neither granted nor taken any loans,
secured or unsecured, to / from companies, firms or other parties
covered in the register maintained under Section 301 of the Act.
Therefore, clauses (iii)a to (iii)g of paragraph 4 of the Order are not
applicable to the company for the year.
3. In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the company and the nature of its
business with regard to purchase of fixed assets and for services
rendered. During the course of our audit, no major weaknesses have
been noticed in the internal controls and therefore the reporting of
the same does not arise.
4. a) To the best of our knowledge and belief and according to the
information and explanations given to us, we are of the opinion
that the particulars of contracts or arrangements referred to in
Section 301 of the Act that need to be entered into the register
maintained under Section 301 of the Act have been so entered.
b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of such contracts
or arrangements entered in the register maintained under Section
301 of the Act and exceeding the value of rupees five lakh in
respect of any party during the year have, prima facie, been made
at prices which are reasonable having regard to the nature of
services and the prevailing market prices at the relevant time.
5. The company has not accepted deposits from public.
6. The company has an internal audit system, which in our opinion, is
commensurate with the size and the nature of its business.
7. The Central Government has not prescribed the maintenance of cost
records under Section 209(1)(d) of the Act.
8. According to the records of the company and the information and
explanations given to us, undisputed statutory dues, including
Provident Fund, Employees State Insurance, Income tax, Wealth Tax,
Service Tax and other material statutory dues have been regularly
deposited during the year with the appropriate authorities. According
to the information and explanations given to us, there are no arrears
of statutory dues which are outstanding as at 31st March, 2012 for a
period of six months from the date they became payable.
9. According to the records of the company and the information and
explanations given to us, there are no dues of Provident Fund,
Employees State Insurance, Income tax, Wealth tax and Service tax
which have not been deposited on account of any dispute.
10. The company does not have any accumulated losses at the end of the
financial year and has not incurred cash losses during the current and
immediately preceding financial year.
11. Based on our audit procedure and on the information and
explanations given by the management, we are of the opinion that
the company has not defaulted in repayment of dues to the bank.The
company does not have any borrowing from financial institutions, or
by issue of debentures.
12. According to the information and explanations given to us, the
company has not granted loans or advances on the basis of security
by way of pledge of shares, debentures and other securities.
13. The provisions of any special statute applicable to chit fund / nidhi /
mutual benefit fund / societies are not applicable to the company.
14. Based on our examination of records and information and
explanations given to us, proper records have been maintained of the
transactions and contracts relating to dealing in securities and other
investments and timely entries have been made therein. The securities
and other investments have been held by the company in its own
name.
15. In our opinion and according to the information and explanations
given to us, the company has not given any guarantees for loans taken
by others from banks or financial institutions.
16. The company has not availed any long term loan during the year.
17. According to the information and explanations given to us, the
company has not raised funds on short term or long term basis during
the year.
18. The company has not issued debentures during the year.
19. The company has not raised monies by public issue during the year.
20. To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud on or by the
company was noticed or reported during the year.
21. In our opinion and according to the information and explanations
given to us, the nature of the company’s business/ activities during the
year have been such that clauses ii and xiii and xviii of paragraph 4
of the Companies (Auditors’ Report) Order, 2003 are not applicable
to the company for the year.
For BRAHMAYYA & CO.,Chartered Accountants
Place : Chennai Firm Registration Number: 000511S
Date : May 15, 2012
P.BABUPartner
Membership No.203358
Annual Report 2011-129
Sundaram Asset Management Company Limited
ANNEXURE TO THE AUDITORS’ REPORT REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE
Balance SheetAs at 31st March, 2012 (Amount in Rs)
Particulars Note 31.03.12 31.03.11I. Equity and Liabilities1. Shareholders' Funds
(a) Share Capital 2 15,33,32,290 15,33,32,290(b) Reserves and Surplus 3 51,37,61,836 43,93,70,900(c ) Money received against share warrants - 66,70,94,126 - 59,27,03,190
2. Share Application Money Pending Allotment - -
3. Non-Current Liabilities(a) Long Term Borrowings - - (b) Deferred Tax Liabilities 4 5,56,99,181 5,75,16,195(c) Other Long Term Liabilities - - (d) Long Term Provisions - 5,56,99,181 - 5,75,16,195
4. Current Liabilities(a) Short Term Borrowings 5 5,33,33,334 - (b) Trade Payables 6 6,25,16,961 10,87,96,536(c) Other Current Liabilities 7 1,03,04,925 1,35,76,440(d) Short Term Provisions 8 4,30,45,636 16,92,00,856 4,57,86,555 16,81,59,531
Total 89,19,94,163 81,83,78,916
II. Assets1. Non-Current Assets(a) Fixed Assets
(i) Tangible Assets 9 4,29,51,593 3,39,28,547(ii) Intangible Assets 9 88,35,071 94,88,069(iii) Capital work-in-progress - - (iv) Intangible Asset Under Development - -
(b) Non-Current Investments 10 98,490 98,490 (c) Deferred Tax Assets - - (d) Long Term Loans and Advances 11 31,01,69,964 14,77,06,937(e) Other Non-Current Assets - 36,20,55,118 - 19,12,22,0432. Current Assets(a) Current Investments 12 1,85,00,000 21,29,53,389(b) Inventories - - (c) Trade receivables 13 3,70,88,486 6,68,62,484(d) Cash and Bank Balances 14 68,11,491 90,34,103(e) Short Term Loans and Advances 15 46,75,39,068 33,83,06,897(f) Other Current Assets - 52,99,39,045 - 62,71,56,873
Total 89,19,94,163 81,83,78,916
Significant accounting policies and notes to the accounts 1 to 21
Annual Report 2011-1210
Sundaram Asset Management Company Limited
For Brahmayya & Co.Chartered AccountantsFirm Registration Number: 000511S
P.BabuPartnerMembership No.203358
Chennai15th May, 2012
D.N.GhoshChairman
Ashoke BijapurkarDirector
Rishikesha T KrishnanDirector
T P RamanManaging Director
S KrishnamurthyDirector
T T Srinivasaraghavan Director
T Anantha NarayananDirector
Harsha VijiDeputy Managing Director
P. SundararajanCompany Secretary
Profit and Loss StatementFor the year ended 31st March 2012 (Amount in Rs)
Particulars Note 2011-12 2010-11
Income
Revenue from operations 16 102,82,78,917 120,95,28,744
Other Income 17 2,27,46,075 1,44,36,097
Total (A) 105,10,24,992 122,39,64,841
Expenditure
Employee Benefits 18 35,38,52,900 32,16,50,800
Administrative and other expenses 19 27,56,82,492 36,61,56,064
Finance Cost - Interest 15,50,959 -
Scheme expenses borne by the company 20 24,94,79,143 31,32,12,376
Depreciation 9 1,52,45,019 1,48,53,220
Total (B) 89,58,10,513 101,58,72,460
Profit before tax (A-B) 15,52,14,479 20,80,92,381
Less : Tax
Current Tax 4,70,00,000 7,50,00,000
Deferred Tax (18,17,014) 4,51,82,986 (5,22,628) 7,44,77,372
Profit after Tax from continuing operations 11,00,31,493 13,36,15,009
Earnings per Equity Share
Number of Shares 1,53,33,229 1,53,33,229
Earnings per Equity Share 7.18 8.71
Significant accounting policies and notes to the accounts 1 to 21
Annual Report 2011-1211
Sundaram Asset Management Company Limited
For Brahmayya & Co.Chartered AccountantsFirm Registration Number: 000511S
P.BabuPartnerMembership No.203358
Chennai15th May, 2012
D.N.GhoshChairman
Ashoke BijapurkarDirector
Rishikesha T KrishnanDirector
T P RamanManaging Director
S KrishnamurthyDirector
T T Srinivasaraghavan Director
T Anantha NarayananDirector
Harsha VijiDeputy Managing Director
P. SundararajanCompany Secretary
1. SIGNIFICANT ACCOUNTING POLICIES1.1 The financial statements are prepared and presented
under the historical cost convention on the accrual basisof accounting and comply with the relevant provisions ofthe Companies Act, 1956.
The preparation of the financial statements in conformitywith generally accepted accounting principles requiresthe use of estimates and assumptions that affect thereported amount of assets and liabilities as at the BalanceSheet date, reported amounts of revenues and expensesduring the year and disclosure of contingent liabilities asat that date. The estimate and assumptions used in thefinancial statements are based upon the management’sevaluation of the relevant facts and circumstances as ofthe date of the financial statements.
1.2 Income Recognition:Investment Management Fees, Advisory Fees and PortfolioManagement Service Fees are accounted on accrualbasis.
1.3 Fixed Assets and Depreciation:Fixed Assets are stated at historical cost less accumulateddepreciation.
Depreciation on assets is provided on the Written downValue Method at rates prescribed in Schedule XIV to theCompanies Act, 1956. Assets costing Rs.5000 or lessacquired during the year are written down to Re.1.
Expenditure incurred towards renovation, interiordecoration etc. in respect of leased office premises iscapitalised under “Improvement to rented premises” andamortised over the primary lease period.
Vehicles taken on lease:Operating Lease payments are recognised as expenditurein the Profit and Loss Account on a straight line basis overthe lease term.
1.4 Valuation of Investments:Long Term investments are carried at cost and provisionfor decline in value, other than temporary is consideredwherever necessary.
Current Investments are valued at lower of cost andmarket value/ net asset value.
1.5 Transactions in Foreign Currency:Transactions in foreign currency are accounted for at therates prevailing on the date of the transaction. Monetaryitems denominated in foreign currencies are restated atthe Prevailing rates of exchange at the Balance Sheet date.Gain or loss arising out of fluctuations in exchange ratesis accounted for in the Profit and Loss Account.
1.6 Employee Benefits:A) Short Term Employee Benefits:
Short Term Employee Benefits to be paid for the servicesrendered by employees are recognized during the periodwhen the services are rendered.
B) Post employment benefits:Defined Contribution Plani) Provident Fund
The Company contributes to a Government-administered Provident Fund and PensionFund.
Defined Benefit Plani) Gratuity
The Company contributes annually to aGratuity Fund administered by trustees andmanaged by Life Insurance Corporation ofIndia. The company accounts its liability forfuture gratuity benefits based on actuarialvaluation, as at Balance Sheet date,determined every year by Life InsuranceCorporation of India using the Projected UnitCredit method.
ii) Leave EncashmentThe Company contributes to a staff leaveencashment scheme managed by LifeInsurance Corporation of India. The Companyaccounts its liability based on an actuarialvaluation, as at the Balance Sheet date,determined every year, using the ProjectedUnit Credit method.
The expenses and actuarial gain / loss onaccount are recognised in the Profit and Losson the basis of actuarial valuation.
1.7 Taxation:Current tax is provided on the taxable income for the year.Deferred tax liabilities on the timing differences are fullyprovided for. Deferred tax assets are recognised on theconsideration of prudence.
1.8 Intangible Assets:Computer Software acquired is recorded as an intangibleasset and the cost is amortised over the expected usefullife.
1.9 Impairment of Assets:The carrying amounts of assets are reviewed at eachbalance sheet date to ascertain impairment based oninternal / external factors. An impairment loss isrecognised when the carrying amount of an asset exceedsits recoverable amount. The amount recoverable is higherof the net selling price of assets and their value in use.
1.10 Provisions:Provisions are recognised when the company has presentlegal or constructive obligations, as a result of past events,for which it is probable that an outflow of economicbenefits will be required to settle the obligation and areliable estimate can be made for the amount of theobligation.
1.11 Scheme Expensesa) New Fund Offer Expenses – Equity Schemes
Expenses incurred in relation to new fund offer areamortized over a period of 24 Months.
b) New Fund Offer Expenses – Debt Schemes
Expenses incurred in relation to new fund offer areamortized over the tenor of the scheme.
c) Amortization Policy on Brokerage Expenses:
Incurred Towards Amortized over a period ofEquity Linked Savings Scheme 36 Months
Open Ended Equity Schemes 12 Months
Annual Report 2011-1212
Sundaram Asset Management Company Limited
Notes to the Accountsforming part of the Balance Sheet as at March 31, 2012 (Amount in Rs.)
Note 2Share Capital :
Particulars 31.03.12 31.03.11Share CapitalAuthorised
2,00,00,000 Equity Shares of Rs 10/- each 20,00,00,000 20,00,00,000
5,00,000 Redeemable Preference Shares of Rs.100/- each 5,00,00,000 5,00,00,000
25,00,00,000 25,00,00,000
Issued, Subscribed and fully paid up
1,53,33,229 Equity Shares of Rs 10/- each 15,33,32,290 15,33,32,290
15,33,32,290 15,33,32,290
Details of number of Shares held by shareholders holding more than 5% shares are set out below :
Name of the Shareholder Status No. of % held as at No. of % held as atShares # 31.03.2012 Shares # 31.03.2011
Sundaram Finance Limited - Holding Company 1,53,33,229 100% 1,53,33,229 100%# Includes six equity shares held by nominees of Sundaram Finance Limited.Reconciliation of the number of equity shares outstanding at the beginning and at the end of financial year are as follows:
Particulars 31.03.12 31.03.11Opening number of shares outstanding 1,53,33,229 1,53,33,229
Add : Shares issued - -
Less: Shares bought back - -
Closing number of shares outstanding 1,53,33,229 1,53,33,229
Note 3Reserves And Surplus
Opening Balance Additions during Deductions / Closing BalanceNature of Reserve as of 01.04.2011 the year Appropriations as of 31.03.2012
during the yearSecurities Premium account 4,13,57,051 - - 4,13,57,051
General Reserve 6,41,80,000 82,52,362 - 7,24,32,362
Surplus * 33,38,33,849 11,00,31,493 4,38,92,919 39,99,72,423
Total 43,93,70,900 11,82,83,855 4,38,92,919 51,37,61,836
Opening Balance Additions during Deductions / Closing BalanceNature of Reserve as of 01.04.2010 the year Appropriations as of 31.03.2011
during the yearSecurities Premium account 4,13,57,051 - - 4,13,57,051
General Reserve 5,05,80,000 1,36,00,000 - 6,41,80,000
Surplus * 25,83,69,538 13,36,15,008 5,81,50,697 33,38,33,849
Total 35,03,06,589 14,72,15,008 5,81,50,697 43,93,70,900* Details of appropriation out of surplus are as follows:
Particulars 31.03.12 31.03.11General Reserve 82,52,362 1,36,00,000
Dividend 3,06,66,458 3,83,33,073
Dividend Distribution Tax 49,74,099 62,17,624
4,38,92,919 5,81,50,697
Annual Report 2011-1213
Sundaram Asset Management Company Limited
Annual Report 2011-1214
Sundaram Asset Management Company Limited
Notes to the Accountsforming part of the Balance Sheet as at March 31, 2012 (Amount in Rs.)
Note 4
Deferred Tax Liabilities:
Particulars 31.03.12 31.03.11
Deferred Tax Liability:
Depreciation 62,77,889 30,00,265
Amortisation of Brokerage 4,94,21,292 5,45,15,930
5,56,99,181 5,75,16,195
Note 5
Short Term Borrowings
Particulars 31.03.12 31.03.11
Secured Loans
From a scheduled Bank 5,33,33,334 -
5,33,33,334 -
Secured by hypothecation of Book Debts of the Company. Repayment of the Loan in six equal installments from February 2012.
Note 6
Trade Payables
Particulars 31.03.12 31.03.11
Trade Payables
For Expenses 6,07,98,601 10,67,37,607
[Includes Rs. 14,00,000/- Payable to Directors
(Previous Year Rs.24,05,000/-)]
For Others 17,18,360 20,58,929
6,25,16,961 10,87,96,536
There are no amounts due and outstanding to be credited to Investor Education & Protection Fund
Note 7
Other Current Liabilities:
Particulars 31.03.12 31.03.11
Other Payable 1,03,04,925 1,35,76,440
1,03,04,925 1,35,76,440
Note 8
Short Term Provisions
Particulars 31.03.12 31.03.11
Provision for Employee Benefits 74,05,079 12,35,858
Others
Dividend 3,06,66,458 3,83,33,073
Dividend Distribution Tax 49,74,099 62,17,624
4,30,45,636 4,57,86,555
Annual Report 2011-1215
Sundaram Asset Management Company Limited
Tang
ible Assets
Offi
ce E
quip
men
t1,
59,7
6,94
511
,07,
390
5,03
,863
1,65
,80,
472
80,8
5,60
411
,83,
309
2,84
,604
89,8
4,30
875
,96,
164
78,9
1,34
1
(1,4
9,80
,193
)(1
0,56
,752
)(6
0,00
0)(1
,59,
76,9
45)
(68,
28,7
51)
(13,
01,5
89)
(44,
737)
(80,
85,6
04)
(78,
91,3
41)
(81,
51,4
42)
Elec
trica
l Equ
ipm
ent
1,48
,30,
397
29,1
9,77
599
,430
1,76
,50,
742
69,0
1,04
013
,97,
879
37,6
9982
,61,
220
93,8
9,52
279
,29,
358
(1,3
0,54
,034
)(2
0,58
,467
)(2
,82,
104)
(1,4
8,30
,397
)(5
4,64
,917
)(1
6,17
,561
)(1
,81,
438)
(69,
01,0
40)
(79,
29,3
58)
(75,
89,1
17)
Com
pute
rs4,
58,4
0,28
739
,99,
995
1,73
,245
4,96
,67,
037
3,59
,99,
232
48,3
7,97
41,
34,2
084,
07,0
2,99
889
,64,
039
98,4
1,05
4
(4,3
1,27
,095
)(6
8,39
,542
)(4
1,26
,350
)(4
,58,
40,2
87)
(3,4
2,34
,715
)(5
2,37
,378
)(3
4,72
,860
)(3
,59,
99,2
32)
(98,
41,0
54)
(88,
92,3
80)
Furn
iture
and
fixt
ures
1,50
,17,
348
4,46
,348
1,00
,525
1,53
,63,
171
1,17
,57,
030
8,70
,636
84,4
191,
25,4
3,24
728
,19,
924
32,6
0,31
9
(1,5
1,95
,780
)(4
,93,
021)
(6,1
7,45
3)(1
,50,
17,3
48)
(1,1
3,45
,563
)(8
,75,
207)
(4,6
3,74
0)(1
,17,
57,0
30)
(32,
60,3
19)
(38,
50,2
17)
Vehi
cles
24,1
6,76
3-
46
,836
23,6
9,92
717
,87,
327
1,62
,000
33
,348
19,1
5,97
84,
53,9
496,
29,4
36
(23,
87,6
64)
(51,
978)
(22,
879)
(24,
16,7
63)
(15,
85,7
85)
(2,1
6,90
4)(1
5,36
3)(1
7,87
,327
)(6
,29,
436)
(8,0
1,87
9)
Impr
ovem
ent t
o re
nted
pre
mis
es3,
18,1
9,03
11,
20,8
3,55
259
,84,
865
3,79
,17,
718
2,74
,41,
991
27,3
2,59
759
,84,
865
2,41
,89,
723
1,37
,27,
995
43,7
7,03
8
(2,7
4,55
,774
)(4
3,63
,256
)-
(3
,18,
19,0
31)
(2,4
4,50
,669
)(2
9,91
,323
)-
(2
,74,
41,9
91)
(43,
77,0
38)
(30,
05,1
06)
Total T
angible As
sets
12,59,00
,771
2,05
,57,06
069
,08,76
413
,95,49
,065
9,19
,72,22
31,11
,84,39
465
,59,14
39,65
,97,47
44,29
,51,59
33,39
,28,54
7
Intang
ible Assets
Com
pute
r Sof
twar
e2,
45,8
9,78
034
,07,
627
-
2,79
,97,
407
1,51
,01,
711
40,6
0,62
5-
1,
91,6
2,33
688
,35,
071
94,8
8,06
9
(1,4
7,01
,420
)(9
8,88
,360
)-
(2
,45,
89,7
80)
(1,2
4,88
,452
)(2
6,13
,259
)-
(1
,51,
01,7
11)
(94,
88,0
69)
(22,
12,9
68)
Total Intan
gible As
sets
2,45
,89,78
034
,07,62
7-
2,79
,97,40
71,51
,01,71
140
,60,62
5-
1,91
,62,33
688
,35,07
194
,88,06
9
Grand
Total
15,04,90
,551
2,39
,64,68
769
,08,76
416
,75,46
,472
10,70,73
,934
1,52
,45,01
965
,59,14
311
,57,59
,810
5,17
,86,66
44,34
,16,61
6
Previous Year
(13,09
,01,96
1)(2,46,97
,376
)(51,08
,786
)(15,04
,90,55
1)(9,63,98
,852
)(1,48,53
,220
)(41,78
,138
)(10,70
,73,93
4)(4,34,16
,616
)(3,45,03
,109
)
Figu
res
in b
rack
ets
perta
in to
31s
t Mar
ch 2
011.
Inta
ngib
le A
sset
s : In
acc
orda
nce
with
Acc
ount
ing
Stan
dard
AS
26 –
Inta
ngib
le A
sset
s, S
oftw
are
purc
hase
am
ount
ing
to R
s.34
,07,
627/
-(31.
03.2
011
– Rs
.98,
88,3
60/-)
is a
mor
tised
ove
r a p
erio
d of
thre
e
year
s ba
sed
on a
tech
nica
l val
uatio
n.
Note:
9Fixed Assets
(Am
ount
in R
upee
s)
GROS
S BLO
CK AT C
OST
DEPR
ECIATION
NET B
LOCK
Descrip
tion
As at
Addit
ions
Dedu
ction
sAs
atUp
to
Addit
ions
Dedu
ction
sUp
toAs
at
As a
t01
.04.20
1131
.03.20
1231
.03.20
1131
.03.20
1231
.03.20
1231
.03.20
11
Annual Report 2011-1216
Sundaram Asset Management Company Limited
Notes to the Accountsforming part of the Balance Sheet as at March 31, 2012 (Amount in Rs.)
Note 10Non - Current Investments
Particulars 31.03.12 31.03.11Un-Quoted
Non Trade:Investments in Mutual Funds 98,490 98,490 (9,849 Units of Face Value Rs.10/- each in Sundaram Capital Protection Fund 3 Years Series II)[Net Asset Value as on 31.03.2012 : 1,04,000/-)
98,490 98,490
Note 11Long Term Loans And Advances
Particulars 31.03.12 31.03.11Unsecured, Considered Good :
Brokerage Recoverable from Mutual Fund Schemes 23,17,02,596 5,86,59,998Prepaid Expenses 6,14,54,359 6,11,91,611Security Deposit 1,55,33,849 2,64,76,694Others 14,79,160 13,78,634
31,01,69,964 14,77,06,937
Note 12Current Investments
Particulars 31.03.12 31.03.11Un-Quoted
Non Trade:Investments in Mutual Funds 1,85,00,000 21,29,53,389
1,85,00,000 21,29,53,389
31.03.2012Scheme Name Units Face Value CostSundaram FTP BN - Growth Option 50,000 10.00 5,00,000Sundaram FTP BO - Growth Option 50,000 10.00 5,00,000Sundaram Ultra Short-Term Fund-Daily Dividend Reinvestment Plan-Institutional Option 17,43,549 10.00 1,75,00,000Total 1,85,00,000
Particulars Cost Net Asset ValueAggregate of Quoted Investments - - Aggregate of Unquoted Investments 1,85,00,000 1,85,40,000
31.03.2011Scheme Name Units Face Value CostSundaram Interval Fund E - Dividend Option 8,39,365 10.00 83,93,645HDFC Quarterly Interval Plan C - Dividend Option 10,00,000 10.00 1,00,00,000Kotak FMP 6M Series 10 - Dividend Option 10,00,000 10.00 1,00,00,000DSP Blackrock FMP 3 M Series 28 - Growth 20,00,000 10.00 2,00,00,000Sundaram Ultra ST Fund - Daily Dividend Reinvestment Plan-Institutional Option 17,43,549 10.00 1,31,91,987HDFC Floating Rate - Short Term Income Fund-Daily Dividend Reinvestment Plan - Institutional Option 3,36,776 10.00 33,67,757HDFC M.I.P Long Term - Dividend Option 7,50,000 10.00 75,00,000Birla Sunlife M.I.P Savings 5 - Dividend Option 5,50,000 10.00 55,00,000HDFC FMP - 13 Months - March '10 - Growth Option 20,00,000 10.00 2,00,00,000Sundaram FMP - Series R - Growth Option 20,00,000 10.00 2,00,00,000Sundaram FMP - Series AN - Growth Option 20,00,000 10.00 2,00,00,000Sundaram FMP - Series AO - Growth Option 20,00,000 10.00 2,00,00,000HDFC FMP - 367 Days - Sept 10 - Growth Option 15,00,000 10.00 1,50,00,000HDFC FMP - Series XV - Growth Option 20,00,000 10.00 2,00,00,000Sundaram FMP - Series AP - Growth Option 20,00,000 10.00 2,00,00,000Total 21,29,53,389Investments valued at cost
Annual Report 2011-1217
Sundaram Asset Management Company Limited
Notes to the Accountsforming part of the Balance Sheet as at March 31, 2012 (Amount in Rs.)
Note 13
Trade Receivables
Particulars 31.03.12 31.03.11
Unsecured, Considered Good :
Trade Receivables
Asset Management Fee 3,21,09,331 4,95,03,758
Advisory Fee 11,41,407 1,48,99,592
Portfolio Management Fee 38,37,748 24,59,134
3,70,88,486 6,68,62,484
Note 14
Cash And Bank Balances
Particulars 31.03.12 31.03.11
Cash and Bank Balances
Cash on Hand 1,17,878 2,86,273
Balances with Scheduled Banks in
Current Accounts 59,76,763 69,15,069
Balances with Bank held in abroad
Current Accounts 11,130 12,25,756
Deposit Accounts - More than 12 months 7,05,720 6,07,005
(A lien has been created on the deposit in favour of a
Bank for Guarantee issued)
68,11,491 90,34,103
Note 15
Short Term Loans And Advances
Particulars 31.03.12 31.03.11
Unsecured, Considered Good :
Brokerage Recoverable from Mutual Fund Schemes 19,67,09,079 8,72,33,097
Prepaid Expenses 12,40,00,854 15,38,85,844
Security Deposit 73,67,796 6,36,192
Others 1,23,31,658 32,35,769
Advance Income tax and Tax Deducted at Source(Net) 12,33,18,893 8,95,05,207
[Includes Rs. 7,67,43,730/- towards income tax
paid under dispute]
Advance Fringe Benefit Tax (Net) 38,10,788 38,10,788
46,75,39,068 33,83,06,897
Advance Income tax and Tax deducted at source is net of provision for taxation Rs. 33,44,33,918/- (31.03.11 Rs. 28,74,33,918/-)
Advance Fringe Benefit tax is net of provision for fringe benefit tax Rs. 28,86,509/- (31.03.11 Rs. 28,86,509 /-)
Annual Report 2011-1218
Sundaram Asset Management Company Limited
Notes to the Accountsforming part of the Profit and Loss Statement for the year ended March 31, 2012 (Amount in Rs.)
Note: 16
Revenue From Operations
Particulars 2011-12 2010-11
Services Rendered:
Investment Management Fees (Net) 101,23,47,495 112,80,47,878
Advisory Fees 1,03,72,546 7,70,49,056
Portfolio Management Service Fees 55,58,876 44,31,810
102,82,78,917 120,95,28,744
Investment Management fees is net of advisory fees paid Rs. 37,43,725 /- (31.03.11–Rs. 53,12,985/-).
Note: 17
Other Income
Particulars 2011-12 2010-11
Interest receipts 70,69,548 24,75,695
Dividend Income 16,82,447 92,63,481
Profit on Sale of Tangible Assets 6,32,372 43,515
Profit on Sale of Non Current Investment 1,16,64,843 18,94,669
Gain on Exchange Fluctuation 1,69,579 -
Miscellaneous income 15,27,286 7,58,737
2,27,46,075 1,44,36,097
Note: 18
Establishment Expenses
Particulars 2011-12 2010-11
Salaries, allowances and bonus 32,63,08,282 29,97,56,719
Company's contribution to Provident Fund, ESI Scheme 1,46,01,129 1,27,58,633
Contribution to Gratuity Fund 49,79,240 27,50,461
Staff welfare expenses 79,64,249 63,84,987
35,38,52,900 32,16,50,800
Annual Report 2011-1219
Sundaram Asset Management Company Limited
Notes to the Accountsforming part of the Profit and Loss Statement for the year ended March 31, 2012 (Amount in Rs.)
Note: 19
Administrative And Other Expenses
Particulars 2011-12 2010-11
Rent 5,12,65,783 4,86,67,409
Fund Accounting Charges 2,08,97,068 2,23,03,017
Rates and Taxes 15,20,462 7,54,365
Communication Expenses 1,98,99,317 1,94,89,377
Subscription 1,99,31,257 1,69,17,063
Advertisement - 7,63,47,572
Electricity Charges 63,17,135 59,23,922
Lease Rental 27,31,663 26,77,300
Travelling and Conveyance 2,54,75,993 2,27,96,220
Director's Sitting Fees and Commission 6,70,000 10,80,000
Insurance 38,47,069 32,13,999
Professional and Consultancy Fees 1,67,96,230 3,21,39,158
Repairs and Maintenance
- Building 1,02,54,212 83,06,148
- Others 1,04,98,374 38,74,915
Database and Networking Expenses 1,51,91,837 1,04,86,581
Loss on exchange fluctuation 6,70,896 12,24,937
Outsourcing Cost 3,89,80,516 3,11,53,168
Miscellaneous expenses 3,06,48,768 3,71,16,871
Loss on sale of Current Investments 5,297 -
Loss on sale of Non Current Investments - 2,13,19,204
Loss on sale of tangible assets 80,615 3,64,838
27,56,82,492 36,61,56,064
Miscellaneous Expenses includes remuneration to Auditors:
Particulars 2011-12 2010-11
Statutory Audit 5,00,000 3,00,000
Tax Audit 2,00,000 1,20,000
Certification Fees 1,85,000 1,89,000
8,85,000 6,09,000
Note: 20
Scheme Expenses Borne By The Company
Particulars 2011-12 2010-11
Upfront Brokerage 21,13,73,600 29,29,59,392
Other Marketing Expenses 3,81,05,543 2,02,52,984
24,94,79,143 31,32,12,376
Note 21. GENERAL:21.1 The Company has identified Asset Management,
Investment Advisory Service and Portfolio ManagementService as the only business segment.
21.2 Employee Benefits:1. Defined Contribution Plan:
(In Rs.)Company Contribution to 2011-12 2010-11 2009-10 2008-09 2007-081. Provident Fund 1,26,00,971 1,08,79,969 92,89,367 90,50,015 66,76,0962. Pension Fund 18,25,634 16,53,122 15,50,449 16,03,470 13,31,9043. Employees State Insurance 1,04,784 1,65,253 Nil Nil 75,0002. Defined Benefit Plan:GratuityA. Reconciliation of opening and closing balances of
present value of the defined benefit obligation(In Rs.)
2011-12 2010-11Present Value of obligations at the beginning of the Year 1,99,02,183 1,68,17,856Interest Cost 15,92,175 13,45,428Current Service Cost 27,31,880 32,81,320Benefit Paid (80,942) (9,02,018)Actuarial Loss on obligation 24,45,626 (2,54,574)Past Service Liability of employees transferred out - (3,85,829)Present value of obligation at the end of the Year 2,58,67,9221,99,02,183B. Reconciliation of opening and closing balances of fair
value of the Plan Assets Fund Maintained by LIC (In Rs.)
2011-12 2010-11Fair Value of Plan asset at the beginning of the Year 1,86,66,325 1,35,42,235Expected return on plan assets 17,90,441 16,21,713Contribution 12,35,858 44,04,395Benefit Paid (8,03,942) (9,02,018)Actuarial Gain on obligation NIL NILFair Value of plan asset at the end of the Year 2,08,88,682 1,86,66,325C. Reconciliation of present value of defined benefit
obligation and fair value of plan assets of the assets andliabilities
(In Rs.)2011-12 2010-11
Present Value of obligations at beginning of the Year 2,58,67,922 1,99,02,183Fair Value of Plan asset at the end of the Year. 2,08,88,682 1,86,66,325Net Liability recognised in the balance sheet 49,79,240 12,35,858D. Expenses recognised in the profit and loss account
(In Rs.)2011-12 2010-11
Current Service Cost 27,31,880 32,81,320Interest Cost 15,92,175 13,45,428Expected return on plan assets (17,90,441) (16,21,713)Net Actuarial loss recognised in the year 24,45,626 2,54,574Expenses to be recognised in the Profit and Loss Account49,79,240 27,50,461E. Actuarial Gain / Loss recognised
(In Rs.)2011-12 2010-11
Actuarial loss on obligation 24,45,626 2,54,574Actuarial gain on plan assets NIL NILActuarial Loss for the year 24,45,626 2,54,574
G. Actuarial AssumptionPer Annum
Actuarial Assumption* 31.03.2012 31.03.2011Discount Rate 8.00% 8.00%Salary Increment 7.00% 7.00%Rate of Return 9.25% 9.25%Attrition Rate 1-3% 1-3%The estimates of future salary increases, considered in actuarialvaluation, takes account of inflation, seniority, promotion andother relevant factors like supply and demand in theemployment market.Particulars 2011-12 2010-11 2009-10 2008-09 2007-08Defined Benefit Obligation 2,58,67,922 1,99,02,183 1,68,17,856 1,19,05,278 83,43,296Plan Asset 2,08,88,682 1,86,66,325 1,35,42,235 68,78,202 42,37,202Surplus / Deficit (49,79,240) (12,35,858) (32,75,621) (50,27,076) (41,06,094)Expenses Adjustment on Plan Liabilities 24,45,626 2,54,574 11,53,406 35,98,703 29,49,331Income Adjustment on Plan Asset Nil Nil Nil 2,27,317 1,08,1953. The Present value of obligation towards compensated
absences, as per actuarial certificate as on 31.03.12 wasRs. 1,79,89,033/- (31.03.11 Rs. 1,50,56,479/-) and isrecognised in the books of accounts.
21.3 Disclosures in respect of operating lease contracts as perAS 19 – “Leases”
The future minimum lease payments payable under non-cancellable operating lease are as follows:
(In Rs)Particulars 31.03.2012 31.03.2011Not later than one year 17,46,829 25,42,288 Later than one year and not later than five years 17,75,755 29,43,828Later than five years Nil NilThe leases can be renewed on expiry of the primary leaseperiod, after mutually discussing the renewal terms with thelessor.21.4 In accordance with the Accounting Standard AS – 18 on
“Related party Disclosures” Related PartiesHolding Company:Sundaram Finance LimitedFellow Subsidiaries:Sundaram BNP Paribas Home Finance Limited.Sundaram Trustee Company Limited.LGF Services Limited.Sundaram Finance Distribution Limited.Sundaram Infotech Solutions Limited.Sundaram Business Services Limited.Infreight Logistics Solutions Limited.Professional Management Consultants Limited.Sundaram BNP Paribas Fund Services Limited.Sundaram Insurance Broking Services Limited.Sundaram Parekh Warehousing Services Limited.Caltec Servicez Private Limited.Associate : Sundaram Mutual FundKey Management Personnel : Mr T P Raman – Managing Director
: Mr. Harsha Viji – Deputy Managing Director
Annual Report 2011-1220
Sundaram Asset Management Company Limited
Details of Related Parties Transactions for the year ended 31.03.2012 (Amount in Rs.)
Particulars Holding Company Fellow/ Subsidiaries / Associates Key Management Personnel 2011-12 2010-11 2011-12 2010-11 2011-12 2010-11
IncomeInvestment Management and Advisory FeesSundaram Mutual Fund — — 101,60,91,220 113,33,60,863 — —(Grouped under Note 16 – Revenue from Operations)Service IncomeSundaram Trustee Company Limited — — 18,00,000 18,00,000 — —(Grouped under Note 18 – Employee Benefits)Total — — 101,78,91,220 113,51,60,863 — —ExpensesRent and Office MaintenanceSundaram Finance Ltd 1,19,24,870 1,16,50,000 — — — —Sundaram BNP Paribas Home Finance Ltd — — 48,000 54,000 — —(Grouped under Note 19 - Administrative Expenses - Rent)Vehicle Lease RentalSundaram Finance Ltd 25,78,000 24,05,000 — — — —(Grouped under Note 19 - Administrative Expenses – Lease Rent)RemunerationT.P.Raman – Managing Director — — — — 1,00,54,331 98,78,809 (Grouped under Note 18 – Employee Benefits)Payroll processing and AMC Accounting ChargesSundaram Business Services Ltd — — 13,68,000 2,88,000 — —(Grouped under Note 19 - Administrative Expenses – Miscellaneous Expenses)Fund Accounting and Call Centre ChargesSundaram BNP Paribas Fund Services Ltd — — 3,79,38,603 2,49,04,500 — —(Grouped under Note 19 - Administrative Expenses – Fund Accounting)System Services CostSundaram Finance Ltd 4,63,000 — — — — —(Grouped under Note 19 - Administrative Expenses – Repairs and Maintenance Cost)Maintenance of WebsiteSundaram Finance Ltd 3,54,400 3,59,000 — — — —(Grouped under Note 19 - Administrative Expenses – Repairs and Maintenance Cost)Internal, Concurrent and Audit FeesSundaram Finance Ltd 4,00,000 2,50,000 — — — —(Grouped under Note 19 - Administrative Expenses – Miscellaneous Expenses)Total 1,57,20,270 1,46,64,000 3,93,54,603 2,52,46,500 1,00,54,331 98,78,809AssetsAcquisition of SoftwareSundaram Finance Limited — 89,000 — — — —(Grouped under Note 9 – Intangible Asset)Investment in Trust Securities at the end of the yearSundaram Mutual Fund — — 1,85,98,490 10,16,84,000 — —(Grouped under Note 12 – Current Investment)Total — 89,000 1,85,98,490 10,16,84,000 — — LiabilitiesOther LiabilitiesSundaram Finance Ltd 59,01,544 2,52,000 — — — —(Grouped under Note 6 – Trade Payables)Sundaram Business Services Ltd — — 1,36,500 24,000 — —Sundaram BNP Paribas Fund Services Ltd — — 23,24,274 38,20,276 — —Payable to Managing Director — — — — 14,00,000 19,05,000(Grouped under Note 6 – Trade Payables)Final Dividend 3,06,66,458 3,83,33,073 — — — —Total 3,65,68,002 3,85,85,073 24,60,774 38,44,276 14,00,000 19,05,000
Annual Report 2011-1221
Sundaram Asset Management Company Limited
As per our report of even date attached Signature to Note no. 1 to 21
Annual Report 2011-1222
Sundaram Asset Management Company Limited
Notes to the Accounts (continued)
For Brahmayya & Co.Chartered Accountants
Firm Registration Number: 000511S
P.BabuPartner
Membership No.203358
Chennai
15th May, 2012
D.N.GhoshChairman
Ashoke BijapurkarDirector
Rishikesha T KrishnanDirector
T P RamanManaging Director
S KrishnamurthyDirector
T T Srinivasaraghavan Director
T Anantha NarayananDirector
Harsha VijiDeputy Managing Director
P. SundararajanCompany Secretary
21.5 The Deputy Managing Director of the Company has been
nominated by M/s. Sundaram Finance Limited the
Holding company and no remuneration is borne by this
company.
21.6 During the year, Sundaram Finance Limited the holding
company has incurred Rs.4.74 Lacs towards the Employee
Stock Option Scheme issued under M/s Sundaram
Finance Stock Option Scheme, 2008 to Mr. T.P.Raman,
Managing Director of the Company.
21.7 Earnings per Share (Basic and diluted)
Sl. No Particulars 2011-2012 2010-2011
1. Profit after tax Rs. (A) 11,00,31,493 13,51,15,008
2. Number of shares (nominal
value of Rs.10/- each ) (B) 1,53,33,229 1,53,33,229
3. Earnings per share (Basic
and diluted) – Rs. (A)/(B) 7.18 8.81
4. Dividend proposed to be distributed – Rs. 3,06,66,458 3,83,33,073
5. Dividend per Share – Rs. 2.00 2.50
21.8 Details of Dividend remitted in Foreign Currency
Particulars 2011-12 2010-11
Number of non-resident share holders N.A 1
Number of shares N.A 76,51,281
Amount of Dividend remitted N.A 3,06,05,125
Financial Year to which the dividend relates N.A 2009-10
21.9 Sundaram Mutual Fund (SMF) has, during the year,
received Income Tax recovery notices to the extent of
Rs.10 Crores pertaining to the Pass through Certificates
(PTC) subscribed by the schemes of SMF during the
financial year 2008-09 wherein IL & FS Trustee
Company Limited was the Trustee to the securitization
transaction. SMF has obtained a stay order from the
Hon’ble High Court of Mumbai against the recovery
proceedings till the disposal of the appeals by the CIT
(Appeals). Based on the opinion obtained and
considering the fact that the Mutual Fund schemes are
exempt from Income Tax, no provision has been made in
the books of accounts of the company.
21.10 Contingent Liabilities:
Particulars 2011-2012 2010-2011
Claims against the Company
not acknowledged as debts on
Income Tax matters. Rs. 7,67,43,730/- Rs.7,67,43,730/-
21.11 There are no amounts due to Small Scale Industries in
terms of “The Micro, Small and Medium Enterprises
Development Act, 2006”.
21.12 Expenditure in foreign Currency on payments towards
Salary, Rent, Travelling etc., – Rs. 3,46,09,884/-
(31.03.11 – Rs. 2,53,87,158/-).
21.13 Earnings in Foreign Currency – Advisory fees earned Rs.
1,01,24,324/- (31.03.11 – Rs.7,31,22,548/-)
21.14 The presentation in the balance sheet, profit and loss
statement and notes to the accounts has been in terms of
revised Schedule VI to the companies act 1956, which
has become mandatory with effect from 01/04/2011.
Previous year figures have been regrouped / reclassified
wherever necessary to confirm to the current years
presentation
21.15 Figures have been rounded off to the nearest rupee.
Cash Flow StatementFor the Year ended 31.03.2012 (Amount in Rs.)
Particulars 2011-12 2010-11A Cash Flow from Operating Activities :
Profit/(Loss) after tax 11,00,31,493 13,36,15,008Add:Profit on sale of tangilble assets (6,32,372) (43,515)
Profit on sale of Non Current Investments (1,16,64,843) (18,94,669)Loss on Sale of tangibleAssets 80,615 3,64,838Loss on sale of Current Investments 5,297 2,13,19,204Depreciation 1,52,45,019 1,48,53,220Income Tax 4,70,00,000 7,50,00,000Deferred Tax (18,17,014) (5,22,628)Interest Income (70,69,548) (24,75,695)Dividend Income (16,82,447) (92,63,481)
Operating profit before working capital changes 14,94,96,200 23,09,52,282(Increase) / Decrease in Current Assets - 23,283 (Increase) / Decrease in Long Term Loan and Advances (16,24,63,028) (1,92,26,886)(Increase) / Decrease in Short Term Loan and Advances (12,92,32,171) (10,28,52,266)(Increase) / Decrease in Trade Receivables 2,97,73,998 2,79,69,383Increase / (Decrease) in Current Liabilities (Trade Payables) (9,32,79,575) 2,00,63,847Increase / (Decrease) in Current Liabilities(Other current liabilities) (32,71,515) (55,80,367)Increase / (Decrease) in Current Liabilities(Short Term Provisions) 61,69,221 (35,23,03,069) (9,47,75,626) (17,43,78,632)Cash generated from Operations (20,28,06,869) 5,65,73,650Net Cash from Operating Activities (20,28,06,869) 5,65,73,650
B Cash Flow from Investing ActivitiesPurchase / Sale of Current Investments 19,43,54,674 4,27,59,180Purchase of Fixed Assets - Tangible (2,05,57,060) (2,46,97,376)Purchase of Fixed Assets - Intangible (34,07,627) -Sale of Fixed Assets - Tangible 9,01,378 6,09,325Profit on Sale of Non-Current Investments 1,16,64,843 18,94,669Loss on Sale of Current Investments (5,297) (2,13,19,204)Dividend Income 16,82,447 92,63,481Interest Income 70,69,548 24,75,695Net Cash from Investing Activities 19,17,02,906 1,09,85,771
C Cash Flow from Financing ActivitiesDividend paid (including corporate dividend tax) (4,45,50,697) (7,15,20,313)Current Liability (Short Term Borrowing) 5,33,33,334 -Net Cash From Financing Activities 87,82,637 (7,15,20,313)Net Increase / (Decrease) in Cash & Cash Equivalents (A) + (B) + (C) (23,21,326) (39,60,891)Cash and Cash Equivalents at the beginning of the year 84,27,098 1,23,87,989Cash and Cash Equivalents at the end of the year 61,05,771 84,27,098Note : Cash & Cash Equivalents comprise the following:a. Cash on hand 1,17,877 2,86,273b. Balances with Banks in Current accounts 59,87,894 81,40,825Total 61,05,771 84,27,098
Annual Report 2011-1223
Sundaram Asset Management Company Limited
For Brahmayya & Co.Chartered AccountantsFirm Registration Number: 000511S
P.BabuPartnerMembership No.203358
Chennai15th May, 2012
D.N.GhoshChairman
Ashoke BijapurkarDirector
Rishikesha T KrishnanDirector
T P RamanManaging Director
S KrishnamurthyDirector
T T Srinivasaraghavan Director
T Anantha NarayananDirector
Harsha VijiDeputy Managing Director
P. SundararajanCompany Secretary